PHL wind projects require scale to create more local jobs — Vestas

THE PHILIPPINES can benefit more from renewable energy if the government comes in to help scale up projects, resulting in job creation and boosting local production of power plant components, the regional head of Danish wind turbine maker Vestas Wind Systems AS said.

“The renewable energy industry needs to grow to a certain scale in the Philippines, so you can have local jobs, local production and local manufacturing that will enable the Philippines to exploit its wind and solar resource at a much much lower cost,” he said.

Mr. Turton’s statement comes months after he made a comment on the need for clarity in the local regulatory environment, especially on the government’s stance in boosting the development of renewable energy.

“There is progress,” he said, when asked what has changed since November, when he said investors wanted a clearer policy in the sector.

“We haven’t got any orders in the Philippines but I can see the market developing. I can see investors getting more and more interested in the wind sector here,” he said.

Still, he said there is room for growth in renewables, especially in replacing the capacity provided by conventional technologies.

“I think you can do a lot more to develop the local renewable energy industry. Renewable energy can supply power that’s below the coal and gas prices,” he said.

Even wind energy can be competitive with coal- or gas-fired power plants if the local industry is sizable enough, he added.

“The government needs to kind of help to jump-start the industry to create a bit of scale. It’s a scalable industry. You see it around the world,” he said. “It’s much cheaper than coal. It’s much cheaper than gas and it’s zero-emission.”

“Hybrid” power plants can also be adopted locally, he said.

“In November, we announced Kennedy wind farm in Australia and that’s a combination of wind, solar panels and storage all in one place. So you have the advantage of wind blowing at night, blowing in the mornings … and the sun shining very strongly in the middle of the day,” he said.

Aside from offering guaranteed rates under a feed-in-tariff (FiT) system for renewable energy projects, the government can offer large-scale auctions for thousands of megawatts of new capacity, Mr. Turton said.

“A FiT would do it fine or you (can) create an environment where the local utilities have tax incentives perhaps like they do in the US to develop renewable energy,” he said.

“With the scale comes the cheapness. If you look at a lot of countries in the world, when they do a big auction they will announce [that] in order to participate in the auction, a certain portion of your production has to come from this country,” he said.

“So the manufacturers were oblige to set up production inside the country where the auction is being held so long as the scale is sizeable enough,” he added. — Victor V. Saulon